According to Accenture’s latest research, more than 90% (94%) of public utility executives believe that the distribution business will bear great pressure on revenue growth before 2025. However, they are optimistic about the development potential after 2025 and agree that new digital technologies and emerging business opportunities will improve efficiency and grid performance and promote business growth.
Accenture’s research on digital power grid points out that in the past few years, distribution enterprises have encountered multiple subversive impacts, and the challenges come from regulatory pressure, new technologies such as distributed generation, changing consumer preferences and weak demand. In such an environment, the income growth of enterprises will continue to be under pressure in the short term. Respondents said that the main reasons for this situation include: the investment level of power grid can not keep up with the depreciation rate (16%), the increasing requirements for service reliability and performance supervision (13%) and insufficient energy demand (13%). Accenture’s research has been carried out around the world for five consecutive years. This report investigated 150 utility executives in 25 countries.
Although digital technology will play a key role in releasing business value and promoting growth, most executives (93%) believe that there are still challenges for distribution enterprises to obtain the benefits of digital transformation. Research shows that peer performance is the biggest threat to power companies (25% of respondents agree), so it is necessary to take rapid action to maintain competitiveness.
In the long run, however, executives are not pessimistic. 97% of the enterprises surveyed said that their distribution business is expected to grow after 2025. Enterprise executives believe that the following factors will promote revenue growth, such as the efficiency improvement brought by the transformation of core business processes, the improvement of network performance relying on smart grid technology, the income increase opportunities of core distribution services, new services such as microgrid, and the application of new assets such as distributed generation and storage.
In addition, Accenture’s residential and commercial power demand model shows that demand growth in most areas will stagnate between now and 2036.
Wang Jing, managing director of Accenture Greater China power industry services, said: “With the gradual popularization of distributed energy, the strengthening of supervision and the urgent need to improve energy efficiency, the revenue of distribution enterprises has been impacted, and improving operation performance will be the key to deal with market changes. Chinese enterprises need to become smart grid optimizers, establish and expand leading grid operation capacity, so as to better adapt to, support and lead the rapidly changing energy industry State system to help build a more distributed, low-carbon and user-centered power system. “
Digital transformation of core business can improve efficiency and create new revenue opportunities
In the transformation process of distribution business, digital technology will play a key role in improving work efficiency and power grid performance. From now to 2025, respondents believe that the disruptive technologies that can best support business operations are automation tools such as UAV (59%), digital twin (55%), artificial intelligence (54%), augmented reality and virtual reality (47%), blockchain (44%) and autonomous robot (41%). In fact, almost all (99%) of the respondents believe that by 2025, artificial intelligence technology will be widely used in conventional decision support in the process of centralized equipment control and power grid planning.
The research also shows that the digital transformation of core business can release investment space and support enterprises to actively capture new revenue opportunities. Respondents generally believe that the future growth opportunities lie in the establishment of large-scale distributed generation equipment (71%), grid connected storage (68%) and electric vehicle charging infrastructure (65%).
Enterprise executives also hope to use energy data to become a trusted third-party service provider for consumers. For example, more than three-quarters (77%) of respondents regarded the provision of distribution tariff information as an opportunity for growth, and more than two-thirds of executives believed that demand response plan information and notification and energy use information would be future opportunities.